SBD/Issue 85/Sponsorships, Advertising & Marketing

AIG Says It Will Not Renew Manchester United Shirt Sponsor Deal

ManU Actively Seeking Shirt Sponsor To
Replace AIG When Current Deal Expires
Insurance company AIG confirmed that it "will not renew" its shirt sponsorship of EPL club Manchester United when the deal expires after the '09-10 season, according to Ben Smith of the LONDON TIMES. AIG said that it "remained in discussions over its current deal" with the club. The insurance company required a federal bailout from the U.S. government in September. ManU "remain confident of securing an improved deal elsewhere" when the deal expires (LONDON TIMES, 1/21). ManU Communications Dir Philip Townsend said that the club "sent letters to a 'select number of worldwide companies' offering them the possibility of having their names emblazoned on United's famous red shirts." Townsend added the club is "in dialogue with a select number of top companies worldwide," and said ManU "has so far received sufficient interest to be confident it can improve on its current [US$26.6M] annual partnership with AIG" (Tariq Panja, BLOOMBERG NEWS, 1/20). Sahara spokesperson Abhijit Sarkar: "We can confirm that we have received a proposal for team sponsorship, it is an elaborate one" (BRANDREPUBLIC.com, 1/20). But FORBES' Lionel Laurent writes AIG's departure "will be a problem for Manchester United, which relies on sponsorship for around one-third of its revenues." If the club cannot reach a deal with a sponsor at or above the level of AIG's contract, Owner Malcolm Glazer "will find it even harder to repay the debts he saddled the team with when he bought it in 2005" (FORBES.com, 1/21).

EASTERN CONQUEST: ESPN SOCCERNET's Phil Holland writes while the current economic climate "suggests that United will be lucky to find another company willing to again break the British record shirt sponsorship deal as AIG did, it won't stop United from trying." The possibility of a deal with Sahara "fits neatly with their continued expansion plans," and the "wealth in India makes having a presence in the subcontinent advantageous." While ManU "will be happy to attract new fans from every demographic and social strata in the subcontinent, they will not be expecting to make money from the average fan." The club instead "will be targeting India's burgeoning super rich and the country's business leaders" (ESPNSOCCERNET.com, 1/21). In London, Giles Mole notes ManU has "strong links in both Malaysia and South Korea, so even at a time of financial prudence around the world," the club is "still optimistic of bettering" the AIG deal (London TELEGRAPH, 1/21).

TOPPING UP: In London, Paul Kelso reports EPL club Chelsea and shirt-sponsor Samsung "are in the early stages of negotiations over an extension" of the US$75.6M deal that expires after the '09-10 season. Chelsea is "happy to enter negotiations with a view to securing an improvement on the [US$1.4M] a year they now receive" (London TELEGRAPH, 1/21).

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